Three years to rescue the euro

The rescue package established by eurozone countries and the International Monetary Fund (IMF) to enable Greece to clean up its debt situation will simply postpone the moment of truth for Athens and the euro, writes The Economist leader, which insists that "Greece’s medium-term debt outlook is darker than either its government or the EU admits." Analysts at the weekly have calculated that "even with a fiscal adjustment worth 10% of GDP over the next five years, Greece will either need more official loans for longer than the current rescue package promises or will have to 'restructure' its debts." And this is in a best case scenario: The Economist believes that the next three years will be crucial not just for Athens, but also for "the euro area’s other vulnerable economies:" Portugal, Spain and Italy. These countries will have to "use the next few years to convince the markets that they are not like Greece," and to implement necessary reforms. In the event of a further crisis, their leaders should not assume they will benefit from a bail-out, which "neither the EU nor the IMF could afford."